Kmart 'Superblock' money due

By Andrew Gomes
Advertiser Staff Writer

Kmart is expected to determine today whether it will move ahead with plans to build a Super Kmart store near Ala Moana Center.

The company, which filed for Chapter 11 bankruptcy reorganization last week, said Wednesday that it still wants to build the 175,000-square-foot store on about 10 acres known as the "Ke'eaumoku superblock."

Kmart has notified property owner Wichman Family Trust that it intends to extend a contract to buy the property.

But for the contract to be extended, a trust spokesman said, the retailer also must put additional money into an escrow account today.

If Kmart does not make the payment extending its purchase contract, the Wichman Trust plans to seek another buyer, the spokesman said.

If Kmart extends the contract, challenges remain for the estimated $50 million project.

"Obtaining financing for the project is pretty awkward," said Jeff Arce, chief financial officer of The MacNaughton Group, the Honolulu firm helping Kmart develop the project. "The bankruptcy filing and Kmart's financial issues make it difficult to finance."